Up to $6m pushed for agency of ex-official

Beacon Hill Democrats are looking to steer up to $6 million to a new nonprofit organization to boost international tourism in the Bay State, even though Massachusetts already has an official state agency to lure visitors.

Massachusetts International Marketing Partnership Inc. is headed by former state travel official William H. MacDougall, who was fired in 2001 shortly after he was forced to pay back the state for unsubstantiated travel expenses. His nonprofit, which was formed last year, has already been awarded a $2 million no-bid contract, and Democratic leaders are pushing for $4 million more in next year's budget.

The contract has outraged officials at the Massachusetts Office of Travel and Tourism, which for years has struggled under budget cuts that officials there said left little money for international marketing. While Governor Mitt Romney proposed to nearly double the agency's budget this year from $6.7 million to $12 million to beef up international marketing, Democrats are instead proposing to increase its spending by $1 million, and give $4 million to MacDougall's firm to conduct overseas advertising.

''We do not need competing [organizations] when we already have a successful agency, MOTT, marketing Massachusetts," said office spokesman Joseph Donovan. ''Duplicate functions waste taxpayer money. We are concerned that another [organization] will be duplicating the efforts of MOTT and using scarce resources that can be better used by the state agency that is responsible by statute for marketing Massachusetts."

Though a Republican, MacDougall has forged a close alliance with Democrats on Beacon Hill. He leases office space from the Rendon Group, a Boston Democratic consulting and public relations firm, and until recently MacDougall's second in command was the wife of Rendon Group executive Richard Rendon. Tara Rendon, who worked with MacDougall at the state Office of Travel and Tourism, has since become the top aide to state Representative Eric Turkington, a Democrat who cochairs the Joint Committee on Tourism. Rendon declined to comment, but Turkington insisted that Rendon no longer has any ties to MacDougall's firm.

Senate Ways and Means chairwoman Therese Murray, a Democrat whose district covers parts of tourist-reliant Plymouth and Barnstable counties, has championed steering money away from the state office to MacDougall's company, along with Representative Daniel E. Bosley of North Adams, another Democrat whose district relies heavily on tourism.

''I'm not partisan, and if it takes a Republican to do this job in the private sector, then I say let's do it," Bosley said.

MacDougall, in an interview, said he won the contract based on his ability to market Massachusetts, not his ties to Democratic lawmakers. He insisted that the state office no longer has the capability to launch an effective international marketing campaign because it severed virtually all its ties with public relations agencies and the travel press in recent years.

''MOTT is saying they're doing something, but they're really not doing it," MacDougall said.

In early 2001, Governor Paul Cellucci asked MacDougall to step down from the office post after MacDougall was forced to reimburse the state $1,007 for a plane ticket to London, records and interviews with MacDougall show. The ticket was issued by Virgin Atlantic Airways, an airline that the office and MacDougall were working closely with at the time to promote Massachusetts.

In documents obtained last week by the Globe, MacDougall explained that he purchased the ticket with cash on the day of departure in 1998, but he could not provide documentation to state Auditor A. Joseph DeNucci's office or to travel office officials to prove that he paid cash in the transaction.

In a routine May 2000 audit, DeNucci chided the office for loose financial controls and ethically questionable practices, such as receiving free seat upgrades from airlines it was promoting.

In an interview last week, MacDougall insisted the Virgin flight was not the reason he was let go. Rather, he said, Cellucci was unhappy that the office and the Massachusetts Port Authority competed with each other to promote the state to international travelers, a situation that resulted in an embarrassing Wall Street Journal article. Soon, both agencies dramatically pared down their international marketing efforts, and infuriated hospitality industry members have been lobbying lawmakers ever since to restore funding for international marketing, saying such visitors stay longer and spend more than domestic travelers.

The Journal article ran in May 2000. MacDougall paid the travel office back for the flight in December 2000. His last day on the job was Feb. 1, 2001.

MacDougall insisted that his new company will have stringent financial controls, and that his firm will be independently audited and will report to the travel office.

But Donovan, spokesman for the office , said the agency will have almost no oversight of the MacDougall organization.

In 2003, Murray championed legislation that would have paid $2 million for a competitively bid contract to market Massachusetts overseas. But the process was never completed because two of the three board members of the agency chosen to award the contract, the Massachusetts International Trade Council, resigned.

With the money in danger of being returned to the Legislature's general fund unused, Murray and Bosley this year encouraged the two organizations that put in the strongest bids to merge so they could simply be granted the $2 million. They did so, and, in the end, no formal bid process was completed.

Murray, in an interview, said the no-bid award to MacDougall's partnership was legal. She also said that the travel office had failed to demonstrate an interest or ability in marketing Massachusetts to international tourists.

''We have been extremely frustrated, those of us representing large areas of the tourist industry, that we have not been in the international market," Murray said.

US Commerce Department statistics indicate that Massachusetts has witnessed a slide in international tourism. In 2001, Massachusetts was ranked sixth nationally in share of overseas visitors with 5.4 percent of such tourism in the nation. In 2003, the most recent year available, Massachusetts had dropped to seventh, with 4.6 percent of such tourism.

Arthur A. Canter, president of the Massachusetts Lodging Association, which agreed to work with MacDougall after bidding on the contract, said he hopes the compromise solution now backed by the Legislature brings results.

Said Canter: ''We always look at anything as how is this going to affect the industry. If it generates some heads in beds, then it is beneficial for our membership."

Raphael Lewis's email address is rlewis@globe.com.